INCORPORATED MANAGEMENT COMMITTEE LIABILITY INSURANCE POLICY IMCLIP

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INCORPORATED MANAGEMENT COMMITTEELIABILITY
INSURANCE POLICY (IMCLIP)? ? ? ? ? ? ? ? ? ? ?

• 18 October 2007
• Mun Yeow
• Allens Arthur Robinson
• (Solicitors for Zurich Insurance Company)

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INTRODUCTION

• ? The role of the IMCLIP
• Education (Amendment) Ordinance 2004
• 2004???????
• The role of insurance
• ? The IMCLIP Hotline
• ? Notification of Claims
• ? The Insurance Coverage

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The Role of the IMCLIP

• Legislation was introduced in 2004 to make
  provision for establishment of incorporated
  management committees (IMCs) to manage aided
  schools.
• Education (Amendment) Ordinance 2004
• Section 40AD When an incorporated management
  committee has been established in respect of a
  school, the school shall.. be managed by the
  incorporated management committee.
• ?????????????,?????????????

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The Role of the IMCLIP

• What are the powers of an IMC?
• Section 40AF(1) An incorporated management
  committee of a school may do anything which
  appears to it to be necessary or expedient for
  the purposes of, or in connection with, the
  proper management, administration or operation of
  the school in accordance with the vision and
  mission and the general educational policies and
  principles set by the sponsoring body of the
  school.
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  ????????????????????,???????????????????????

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The Role of the IMCLIP

• Composition of an IMC
• An IMC must comprise (under section 40AL)
• (a) sponsoring body managers
• ??????
• (b) the principal of the school
• ??
• (c) at least one teacher manager and one parent
  manager
• ????????????????

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The Role of the IMCLIP

• (d) one or more alumni managers where
  such are nominated
• (??????)???????????
• (e) not less than one independent manager
• ?????????
• (f) not more than one alternate sponsoring body
  manager
• ?????????????
• (g) in the case of one teacher manager and one
  parent manager, there should be an alternate
  teacher and an alternate parent manager.
• ????????????????,????????????? ?????????

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The Role of the IMCLIP

• Rights and Liability of Managers
• A manager has no civil liability for acts or
  omissions in the performance of their office if
  in good faith
• Section 40BI(2) A manager shall not incur any
  civil liability in respect of anything done or
  omitted to be done by him in good faith in the
  performance or purported performance of any
  function of his office as the manager.
• ?????????????????????????????????????????????????
  ?

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The Role of the IMCLIP

• Section 40BI (3) No civil proceedings shall be
  brought against a manager of a school for
  anything done or omitted to be done by or on
  behalf of the incorporated management committee
  of the school unless he has not acted in good
  faith in relation to the thing or omission.
• ???????????????????????,???????????????????,?????
  ?????????????,???????????????????????????

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The Role of the IMCLIP

• Rather, liability falls on the IMC
• Section 40BI(4) The protection conferred under
  subsection (2) does not in any way affect the
  liability, if any, of the incorporated
  management committee for the act or omission of
  the manager in the performance or purported
  performance of the relevant function.
• ?(2)???????????????? ??????????????????? ?????
  ????????????(? ???)?

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The Role of the IMCLIP

• What does the IMCLIP achieve?
• Entity coverage for the IMC itself
• Insurance for Managers if claims are brought
• - defence costs

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The IMCLIP

• This presentation provides only a brief
  description of the coverage provided by the
  IMCLIP. It does not form part of the IMCLIP. It
  is subject to the interpretation of the original
  wording of the IMCLIP.

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The IMCLIP

• Zurich Insurance Company ????? is the Insurer for
  the IMCLIP. The current insurance period runs
  from 1 September 2007 to 31 August 2008.

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The IMCLIP

• This IMCLIP, arranged by the Education Bureau
  (EDB) on behalf of schools with Incorporated
  Management Committees (IMCs) covers loss in
  respect of any claim made for wrongful acts
  (including management liability, vicarious
  educator liability and employment practice
  liability) against IMCs and their managers.
• ????
• ????
• ???????????
• ???????

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The IMCLIP

• EDB will issue a Certificate of Incorporation
  ???????? to schools when their IMCs are
  established.
• At the same time, their information will be
  forwarded to Zurich Insurance Company.

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The IMCLIP

• The Insurer will then send each IMC school a
  Certificate of Insurance ???? of the IMCLIP and a
  copy of policy wording ?????? within 5 working
  days after the Insurer receives the information
  from EDB (the master policy will be lodged with
  EDB).
• In case you do not receive the Certificate of
  Insurance in good time, please contact the
  School-based Management Section or Zurich
  directly.

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The IMCLIP

• Who is the Insured?
• Incorporated management committees (IMCs) of all
  aided schools, in respect of which an IMC is
  established and their managers.
• Managers of an IMC school include the sponsoring
  body managers, the principal, the teacher
  managers, the parent managers, the alumni
  managers, the independent managers, the alternate
  sponsoring body managers, the alternate teacher
  managers and the alternate parent managers.

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The IMCLIP

• What is the Insurance Coverage?
• To cover an Insured against all Loss for which
  such Insured becomes legally obligated to pay on
  account of any (1) Claim first made against such
  Insured during the (2) Period of Insurance for
  any (3) Wrongful Act committed, attempted, or
  allegedly committed or attempted, by such Insured
  after the Retroactive Date specified in the
  Policy Schedule in their insured capacity of IMC
  and/or Managers of IMC schools.

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The IMCLIP - Timing of Wrongful Acts and their
Notification to Zurich
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The IMCLIP

• What are Wrongful Acts?
• (a) Management Liability ????
• Any actual or alleged breach of duty, breach of
  trust, neglect, error, omission, misstatement,
  misleading statement, defamation or other act
  committed or attempted by any Insured in their
  capacity of IMC of IMC schools and/or Managers
  of IMC schools solely by reason of serving in
  such capacity.

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The IMCLIP

• (b) Vicarious Educator Liability ???????????
• Wrongful educational instruction, career
  guidance, student consumerism, class content,
  grading practices, guidance counselling, student
  enrolment, admittance procedures, expulsion
  procedures, integration, desegregation or
  participation in any extracurricular program,
  busing and other student transportation practices
  relating to a programme or plan of integration or
  desegregation, or any advice in connection with
  any of the above, committed by any past and
  present Managers of IMC Schools in their insured
  capacity.

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The IMCLIP

• (c) Employment Practice Liability ???????
• Any actual or alleged wrongful dismissal or
  unfair dismissal, defamation in relation to
  wrongful or unfair dismissal, wrongful discharge
  or termination of employment, denial of natural
  justice, breach of any oral or written employment
  contract or quasi-employment contract, employment
  related misrepresentation, violation of
  employment discrimination laws, wrongful failure
  to employ or promote, wrongful employment related
  discipline, wrongful deprivation of a career
  opportunity, failure to grant tenure, negligent
  evaluation, sexual harassment or employment
  related wrongful infliction of emotional distress
  committed or attempted by any Insured in their
  capacity of IMC of IMC schools solely by reason
  of serving in such capacity.

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The IMCLIP

• What is the Limit of Indemnity ??????
• HK10 million for any one claim and in the
  aggregate including Defence Costs per IMC school
  during the Period of Insurance.
• ???????????????????????????????????

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The IMCLIP

• What deductibles are payable?
• There is a nil deductible ??? for Claims brought
  against any individual manager of IMC schools.
• In respect of claims against the IMC, the amount
  of the deductible (i.e. HK10,000) for each and
  every Claim (including Defence Costs) shall be
  borne by the IMC at their own cost.

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The IMCLIP

• Extensions
• (a) Additional Notification Period (60 days)
• (b) Advancement of costs, charges and expenses
  to Insured (c) Estates and Legal Representatives
  Extension
• (d) Fraud and Dishonesty Extension in respect of
  the vicarious liability of IMC and innocent
  managers arising out of the fraudulent or
  dishonest acts or omissions of the Managers of
  IMC schools
• (e) Insured v Insured and Employment Related
  Matter including Sexual Harassment
• (f) Intellectual Property
• (g) Libel Slander

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The IMCLIP

• Extensions (contd)
• (h) Loss of Documents
• (i) Official Investigations and Enquiries
• (j) Pension Trustee Liability Extension
• (k) Severability and Non-imputation
• (l) Spousal Liability Extension

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The IMCLIP

• Exclusions
• (a) Known Claims or circumstances
• (b) Asbestos
• (c) Bodily Injury (save for Employment Practice
  Liability) and Property Damage
• (d) Employees Compensation
• (e) Fraud and Dishonesty
• (f) Molestation

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The IMCLIP

• Exclusions (contd)
• (g) Occupiers Liability
• (h) Pollution and Nuclear Risk
• (i) Terrorism
• (j) War
• (k) Vicarious Educator Liability covers IMCs
  and Managers of IMCs in their insured capacity
  as Managers. Such cover does not extend to
  persons whose actual or potential liability
  arises from their role as teachers or educators
  of an IMC School, irrespective of whether they
  may also be a Manager of an IMC School.

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Claims and Notification

• Notice of any Claim must be given to Zurich and
  delivered to
• Claims Manager
• Zurich Insurance Company
• Levels 15-17
• Citiplaza 3
• 14 Taikoo Wan Road
• Hong Kong
• The IMC Claim Form can be downloaded from
  www.edb.gov.hk (http//www.edb.gov.hk/index.aspx?l
  angno1nodeid4788)

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Claims and Notification

• As a condition precedent to the right to be
  indemnified under the IMCLIP, the Insured must
  give to Zurich written notice as soon as
  practicable of any Claim made against the Insured
  PROVIDED ALWAYS THAT such written notice is given
  to Zurich during the same Period of Insurance.

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Claims and Notification

• What is a Claim?
• It includes
• (a) a written or verbal allegation of any
  Wrongful Act communicated to any Insured or
• (b) a civil proceeding commenced by the service
  of a complaint, summons, statement of claim or
  similar pleading against any Insured alleging
  any Wrongful Act or
• (c) a criminal proceeding commenced by a summons
  or charge against any Insured alleging any
  Wrongful Act.

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Claims and Notification

• Reporting of Circumstances
• If during the Period of Insurance, the Insured
  becomes aware of any fact or circumstance that
  could reasonably be expected to give rise to a
  Claim under this Policy the Insured shall as a
  condition precedent to their right to be
  indemnified under this Policy give notice in
  writing to Zurich of such fact or circumstance,
  then any Claim which may subsequently arise out
  of such fact or circumstance shall be deemed to
  be a Claim made during the Period of Insurance.
  PROVIDED ALWAYS THAT such written notice is given
  to Zurich during the same Period of Insurance.

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Claims and Notification

• The effect is that any Claim, or circumstance
  which could reasonably be expected to give rise
  to a Claim under the IMCLIP, must be notified to
  Zurich in the same policy period as the Insured
  becomes aware of that Claim or that circumstance.
• Failure to do so will result in the IMCLIP not
  responding or covering Losses.

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The Hotline

• The IMC Hotline - or enquiry line
• Claims assistance
• Legal advice will not be provided
• Enquiry line will be recorded
• It is staffed by Allens Arthur Robinson,
  solicitors for Zurich
• The telephone number is 852 2903 6220
• Hours of operation 9.15am to 5.00pm each
  business day (not operational on any Saturday)

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The Hotline

• Information which you should have at hand when
  contacting the Hotline
• IMC school name
• IMC school number
• IMCLIP number/Certificate of Insurance details
• Identity of the caller - only Insured are able to
  access the Hotline

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Case Study A

• Management Liability
• Student injured during school hours on school
  premises.
• Management liability or public liability?
• Management liability
• Scenario 1
• IMC has re-allocated staff resources
• Inadequate staff supervision due to re-allocation
  of resources
• Scenario 2
• IMC has resolved to have construction in progress
  during school hours
• Inadequate safety precautions implemented by IMC

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Case Study B

• Vicarious Educator Liability
• Admittance procedures claimed to be unfair in the
  selection of candidates.
• IMC has resolved to implement the admittance
  procedures in question
• Allegations that no reasonable IMC in the same
  circumstances would have implemented the
  admittance procedures in question

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Case Study C

• Employment Practice Liability
• Staff claim to have been unfairly dismissed by
  IMC.
• Terminal payments withheld
• Without notice
• Inadequate warnings
• Inadequate reasons

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